Velazquez v. FPS LP
| Decision Date | 04 August 2014 |
| Docket Number | CIVIL ACTION NO. 4:13-CV-1563 |
| Parties | MOISES VELAZQUEZ, et al, Plaintiffs, v. FPS LP; dba OFFICE FURNITURE CONNECTION, et al, Defendants. |
| Court | U.S. District Court — Southern District of Texas |
Pending before the Court is Plaintiffs' Motion for Conditional Certification, Curative Notice and Invalidation of "Opt-Out" Forms, and Request for Leave to File Additional Declarations Under Seal (Doc. 21). Defendants have filed responses (Docs. 29 and 30). Upon review and consideration of the motion and the responses thereto, the relevant legal authority, and for the reasons stated below, the Court concludes that the motion should be granted.
Plaintiffs filed this suit as a collective action under the Fair Labor Standards Act of 1938 (the "FLSA"), 29 U.S.C. § 201 et seq., against Defendants, Furniture Procurement Services, L.P. d/b/a Office Furniture Connection ("FPS"), Vincent Oddo Interior Service Inc. ("VOIS"), and Vincent Oddo ("Oddo"), the owner of both OFC and VOIS, (collectively, the "FPS Defendants") and TLD Premier Services Inc. ("Premier") and its owner, Telmo Urrutia ("Urrutia"), (collectively, the "Premier Defendants"), (all together, "Defendants"), alleging failure to pay overtime wages. OFC and its sister-company, VOIS, "sell, install, repair, refurbish and store office furniture." Doc. 21 at 2.
Plaintiffs are sixteen current and former "service and installation technicians" who work in Defendants' warehouse in Houston, Texas. Id. As service and installation technicians, Plaintiffs perform repetitive manual labor such as cleaning, packaging, assembling, disassembling, and moving office furniture and cubicles. Id. at 2-3. Together, OFC and VOIS employ approximately 40 service and installation technicians. Id. Plaintiffs allege that they regularly worked between 50 and 60 hours per week and were paid at an hourly rate between $9 and $15, without overtime compensation. Id. at 3. They seek unpaid overtime wages owed, liquidated damages, prejudgment interest and attorneys' fees. Id. at 5-6.
Premier acts as the human resource department for the FPS Defendants by maintaining personnel files and managing payroll. Id.; Doc. 6 ¶ 18. Plaintiffs allege that Premier was created sometime in 2011 or 2012 in order to pass through wages from the FPS Defendants to Plaintiffs and that the FPS Defendants and the Premier Defendants are "joint employers" under the FLSA.1Doc. 6 ¶ 18; Doc. 21 at 2. In support of this assertion, Plaintiffs allege that the FPS Defendants and the Premier Defendants share "a warehouse, sales floor, and executive offices," and Defendant Urrutia acts as both the owner of Premier and the warehouse manager for FPS. Doc. 21 at 2. Also, according to Plaintiffs, Premier does not provide payroll service to any clients other than the FPS Defendants. Id. Plaintiffs allege that before Premier assumed management over the FPS Defendants' payroll services, Plaintiffs received time-and-a-half for hours worked in excess of 80 in a two-week period; and since Premier was created Plaintiffs receive "straight time" for all hours worked. Id. at 4.
Concurrently with the complaint or shortly thereafter, each named Plaintiff filed a written consent to join this action as required by 29 U.S.C. § 216(b). Notices of Consent, Docs. 1-1-1-14; 5; 12. Within a few weeks of filing the consent notices, fourteen of the sixteen Plaintiffs signed and submitted identical withdrawal letters to Plaintiffs' counsel stating: "I have changed my mind and want my name removed from all paperwork in your office." Withdrawal Letters and Envelopes, Doc. 21-10. These letters were collected and sent via FedEx or certified mail. Id. Upon receipt of Plaintiffs' withdrawal letters, Plaintiffs' counsel filed a Charge with the National Labor Relations Board ("NLRB") (Charge No. 16-CA-107685) alleging that Defendants unlawfully interfered with Plaintiffs' exercise of their right to file the instant collective action pursuant to Section 7 of the National Labor Relations Act by disciplining and threatening them. NLRB Charge No. 846-2012-67405, Doc. 21-12. After an investigation, Defendants reached a settlement agreement with the NLRB which required them to post for 60 days the NLRB's "Notice to Employees," which states in essence that employees have a right to act collectively for their benefit without fear of retaliation. Settlement Agreement, Doc. 21-13.
Plaintiffs now move to conditionally certify a class of all service and installation technicians employed by Defendants who were denied overtime in any workweek since January 10, 2011. Doc. 21 at 14. Plaintiffs also request that the Court invalidate the withdrawal letters and issue curative notice to all potential plaintiffs, including those who submitted withdrawal letters. Id. at 16-18. In support of their motion, Plaintiffs attach four declarations detailing Defendants' acts of retaliation against them. See Decl. of Esparza, Doc. 21-3; Decl. of Lara, Doc. 21-4; Decl. of Davila, Doc. 21-5; Decl. of Arteaga, Doc. 21-6; see also Letter of Repudiation by Castillo, Doc. 21-11. They assert that within days of filing the case, Defendants met with each of the workers who joined the suit and threatened them with reduction in work hours and termination. Id. Lara stated that he was forced to sign the withdrawal because Defendants took Wednesday from his work schedule, hired day laborers to fill his position onthat day, and also threatened him with termination. Doc. 21-4 ¶ 12. Castillo wrote that he was threatened with reduced hours if he did not withdraw. Doc. 21-11. Artega stated that he was threatened with termination. Doc. 21-6 ¶ 9. All three withdrew and now wish to rejoin the suit. Doc. 21-4 ¶ 22; Doc. 21-6 ¶ 10; Doc. 21-11. Plaintiffs Davila and Esparza resisted the retaliation, or enticements in the case of Esparza, and did not withdraw. See Docs. 21-3; 21-5.
Shortly after Plaintiffs filed their motion for conditional certification, Defendants filed motions for extension of time to respond and for "leave to communicate with withdrawn plaintiffs outside the presence of counsel." Docs. 22 and 23. Defendants claimed that they sought to communicate with the withdrawn plaintiffs "so as to ascertain their position regarding their withdrawal from the matter and to formulate a response to Plaintiff's Motion." Docs. 22 and 23 ¶ 11.
In an Opinion and Order entered April 28, 2014 (Doc. 28), the Court denied Defendants' motions for leave to communicate with withdrawn plaintiffs, stating:
The declarations in the record regarding the threats of reduction in work schedules and termination, combined with the high rate of attrition (almost 90%) of class plaintiffs, and the uniformity of the withdrawal letters all support the conclusion that Defendants coerced Plaintiffs to withdraw in an attempt to undermine the collective action....Based on the evidence in the record, the Court finds that there is a strong need to restrict Defendants' speech with employees in this case.
Doc. 28 at 5-6. The Court allowed Defendants ten days from the date of entry of the Order to file responses to Plaintiffs' motion for conditional certification. Id. at 6.
Defendants timely filed responses to Plaintiffs' motion in which they argue that (1) conditional certification is not warranted; (2) in the event the Court decides that certification is warranted, notice need not issue as every potential plaintiff is already aware of the suit; (3) in the event the Court decides that notice should issue, the Court should not approve Plaintiffs' proposed notice; (4) the Court should not invalidate the opt-out forms because they were notcoerced; and (5) the Court should not allow Plaintiffs to file any additional declarations under seal. Docs. 29 and 30. The Court considers each argument in turn.
Plaintiffs argue that conditional certification is appropriate in this case as all putative plaintiffs work in a single location under common management, perform similar manual-labor jobs related to installing, upholstering, assembling, and repairing office furniture, and are subject to a common policy of paying "straight time" for overtime. Doc. 21 at 12. Defendants contend that conditional certification is not warranted because different Plaintiffs were employed by different Defendants, each of whom has a different policy regarding overtime, and therefore each one of Plaintiffs' claims will necessitate an individualized inquiry. Docs. 29 and 30 ¶ 11.
Under the FLSA, nonexempt employees must earn a minimum wage of $7.25 per hour, and no employer shall employ any nonexempt employee in excess of 40 hours per week without compensation at one and one-half times the regular rate. 29 U.S.C. §§ 206(a), 207(a). Section 216(b) of the FLSA permits an employee to bring an action "for and [on] behalf of himself . . . and other employees similarly situated." Id. at § 216(b). Collective actions serve the purpose of decreasing litigation costs by efficiently resolving common issues of law and fact in a single proceeding. Hoffman-La Roche, Inc. v. Sperling, 493 U.S. 165, 170 (1989). Putative class members must "opt-in," i.e., affirmatively notify the court of their intention to become parties to the collective action. Id. § 216(b); Mooney v. Armaco Srvcs. Co., 54 F.3d 1207, 1213-14 (5th Cir. 1995), overruled on other grounds by Desert Palace, Inc. v. Costa, 539 U.S. 90, 91-92 (2003). Conditional certification "is not tantamount to class certification under Rule 23."2Genesis Healthcare Corp. v. Symczyk, — U.S. —, 133 S.Ct. 1523, 1532 (2013). The only effect of a conditional certification is that a court-approved written notice may be sent to similarly situated ? putative class members, who then may choose to become parties to a collective action by filing a written notice of consent with the court. Id. at 1530 (citing 29 U.S.C. § 216(b)). Courts have discretion in...
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